Danish Shipping has condemned recommendations to axe seafarer tax exemptions under the Danish International Ship Register (DIS).
The industry organisation said the development is “sad and worrying” and could be disastrous for the domestic flag.
Danish Shipping is urging the government to reject the proposal from the Frigast committee, which was tasked with examining state support for business.
Seafarers of any nation operating on ships flagged with the DIS do not pay income tax.
Danish Shipping said: “The committee concludes that, in the long term, it must be expected that an abolition of the DIS scheme will result in significantly fewer Danish sailors and fewer ships under the Danish flag, but has not further assessed derived effects for employment ashore, etc.”
Chief executive Anne Steffensen added: “It will be a disaster for Danish shipping to abolish the DIS scheme.
“It is basically about maintaining Denmark as a large maritime nation with thousands of employees in Denmark. Abolition of the DIS scheme will lead to significant and massive flagging of Danish-flagged ships to neighbouring countries and other maritime nations around the world.”
Steffensen called the proposal a highly unsafe experiment.
“I cannot warn against that strongly enough,” she said.
There has been broad political support for Danish shipping for many years.
The DIS scheme has been in force since 1988 and the country is among the 10 biggest shipping nations globally.
“Seafaring is often and rightly referred to as an important Danish position of strength,” Steffensen said.
“The DIS scheme is a crucial part of the framework conditions that make it possible for Danish shipping companies to fly the ships under the Danish flag, employ Danish seamen and at the same time be competitive on the global market.
“It is Denmark’s status as a proud maritime nation and maritime superpower that is at stake here.”
Danish Shipping believes the flag will lose ground to Norway, Germany and Singapore.
The move would also imperil its influence on the global regulation of shipping, where it argues that Denmark is setting the agenda, not least in the fight for ambitious global climate rules.
The organisation foresees the eventual disappearance of Danish seafarers should the scheme be axed.
There are about 7,500 Danish crew members currently.
